The Application Study Of Executive Stock Options Incentive System In China's Enterprises

The separation between modern corporate system corporate ownership right and operate right led to the inconsistency of interests between the agency, clients and agents, which has greatly increased the agency costs and that is particularly conspicuous in our business. Reform and opening up to 30 years, effective business incentive mechanisms, in particular the lack of long-term mechanism has become a major obstacle to the development of enterprises, the direct performances are the low efficiency of business operators and the risk of moral. Executive stock options (ESO) in recent years as an effective incentive mechanism for enterprises in western countries, whether in theory or 30 years of practice has proved that executive stock options are a kind of incentive mechanism with more satisfactory and long-term. China has paid more and more attention to provide a new thought line to the construction of incentive mechanism in China's listed companies. In the first part of this paper introduced the historical background and basic theory to executive stock options. The second section describes the application of executive stock options in the United States and in China's Hong Kong Special Administrative Region. The third part is the focus of this paper, firstly introduces historical background of executive stock options enter China, then analyzes the problems in the process of the pilot to executive stock options in China, and analyzes the reasons for the problems and gives out some suggestions, Finally, designs the detail specific to equity incentive program. Aim to provide ideas and suggestions to executive stock options incentive plans in China's design application.